In 2013, MicroStrategy cofounder Michael Saylor didn’t hold Bitcoin in high esteem. He actually thought the coin would fail.
Later on, however, he changed his opinion so radically that he overhauled his company’s business strategy completely – and came up with a new approach based on Bitcoin holding. Today, his decision has turned out to be very wise.
MicroStrategy’s market influence has grown from that of an ordinary software company to one of the top 100 publicly traded companies in the U.S. by market capitalization.
Within the last month, it has overtaken several giants such as Dell and Nike, and as of Wednesday, it ranked number 88 with a market capitalization in excess of $100 billion.Â
MicroStrategy Now Holds Approximately 331,200 Bitcoins
By November 17, 2024, MicroStrategy and its subsidiaries had extended their widely reported Bitcoin acquisition scheme to a total of approximately 331,200 bitcoins.
The average value of each of the bitcoins in their possession, including fees and expenses, stands at roughly $49,874.Â
This latest acquisition coincides with a remarkable surge in Bitcoin’s price that has seen it soar above $90,000, figures that represent all-time highs.
Funding for this recent batch of BTC came from monetizing approximately 13.6 million company shares, a policy that aligns with the company’s “21/21 plan,” an ambitious scheme that aims to generate $42 billion from equity and fixed-income securities within three years.
BTC Republic has previously covered the 21/21 plan and several other MicroStrategy stories.
In a recent comment on X, Saylor declared that MicroStrategy’s cumulative Bitcoin holdings stood at around $26 billion, exceeding the cash reserves of top global brands IBM and Nike.
Since mid-2020, both the values of BTC and MSTR have grown by more than 700% and 2,500%, respectively, making MSTR the best-performing major U.S. stock within that period.Â
The software company has developed a performance metric known as Bitcoin yield, which it uses to estimate the change in the ratio between the Bitcoins it holds and its assumed diluted shares outstanding from period to period. Presently, the year-to-date yield is 26.4%.
Saylor decided to pursue Bitcoin investment in 2020 in order to use the coin as an inflation hedge as MicroStrategy experienced a slow growth in revenue. He says he went “down a rabbit hole” during COVID and regrets not investing in BTC earlier.
The company’s initial bitcoin acquisitions were funded with cash derived from daily operations, but this has subsequently given way to funds generated through equity and debt securities.
Other Corporate Entities Keen On Adopting MicroStrategy’s Model
MicroStrategy has exhibited significant transparency in its operations, regularly providing updates on its Bitcoin holdings.
This has not only helped build trust among investors but also demonstrated the long-term viability of investing in crypto as a safe haven asset.
Other companies, including Metaplanet and Marathon, are now emulating MicroStrategy’s Bitcoin acquisition model. Metaplatanet recently introduced a bond offering of $11.3 million to purchase Bitcoin.
Similarly, Marathon is also implementing a private offering of $700 million convertible notes aimed at funding its acquisition of BTC.Â
Both firms are exploring Bitcoin as a portfolio diversification asset that can enable them to leverage the opportunities in the thriving crypto market.
Additionally, Microsoft shareholders are preparing to vote on a proposal that seeks to allow the company to diversify its assets via Bitcoin investment.
Another area that has recorded significant success is the U.S. spot Bitcoin ETFs, where BlackRock’s iShares Bitcoin Trust (iBIT) is blazing the trail.
Notably, the Bitcoin holdings of MicroStrategy, the world’s largest publicly listed Bitcoin holder, still lag behind the 471,329 Bitcoin held by BlackRock’s iShares Bitcoin Trust (IBIT), the world’s largest Bitcoin exchange-traded fund (ETF).
Data indicates that U.S. spot Bitcoin ETFs now manage assets valued at nearly $104 billion, a laudable achievement within just a year of being approved.
Apart from corporate investment, countries are also becoming increasingly interested in cryptocurrency holdings, potentially indicating a new phase of adoption.
